A businessman appointed by David Cameron to head a multibillion-pound quango has been forced to step down after it was disclosed that he was bankrupt. A government spokesman said Tony Caplin, a former Conservative party chief operating officer, had resigned as chairman of the Public Works Loans Board (PWLB), which is responsible for £60bn of loans in infrastructure projects.

The Mail on Sunday reported that No 10 had been forced to act after an investigation it carried out revealed he had been made bankrupt in 2012. Whitehall rules require anyone serving on a public body who is declared bankrupt to inform the responsible minister immediately.

The government spokesman said: "Tony Caplin was appointed to a number of public bodies by the Labour party. He was reappointed to the PWLB by the prime minister. He should have declared he was bankrupt. This has been pointed out to him, and as a result he has resigned."

Caplin – who has also served as chairman of stockbrokers Panmure Gordon, where Cameron's father, Ian, was a partner, and as non-executive director of biotech company Vaccinogen – has also left his post on the Medical Research Council. He has previously served on a number of other public bodies, including the North West London Hospitals NHS Trust, where he was chairman until January last year. He has been a commissioner on the PWLB for 10 years.

Labour MP Margaret Hodge, who chairs the commons public accounts committee, told the Mail on Sunday: "This raises serious questions, which should be investigated."